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Israel unveiled plans for 3,200 settler homes Thursday in retaliation for the formation of a Palestinian unity government backed by Hamas and the international community, raising the Palestinians' ire.
Tenders for nearly 1,500 new settlement houses and plans to advance some 1,800 others were issued just 72 hours after the new Palestinian government was sworn in, ending seven years of rival administrations in the West Bank and Gaza.
Both Washington and Brussels as well as other western states have shown support for the Palestinian line-up, but Israel says it will boycott what it denounces as a "government of terror".
The news drew a furious reaction from the Palestinians, who pledged to seek an anti-settlement resolution at the UN Security Council for the first time in more than three years.
And the European Union said it was "deeply disappointed" by the Israeli plans.
"We call on the Israeli authorities to reverse this decision and to direct all their efforts towards an early resumption of the peace talks," the bloc said.
Of the 1,454 tenders, 400 homes are to be built in Israeli-annexed east Jerusalem and the rest in the occupied West Bank in what Housing Minister Uri Ariel described as "a fitting Zionist response to the establishment of the Palestinian government of terror".
"I believe these tenders are just the beginning," he added, his remarks becoming reality hours later when an Israeli official confirmed the government had moved to unblock plans for another 1,800 homes.
"The political echelon has ordered the Civil Administration to advance 1,800 new units," he told AFP, referring to a defence ministry unit responsible for West Bank planning issues.
Walla news website said the order, which relates to construction in 10 settlements, had come directly from Prime Minister Benjamin Netanyahu who had given the green light for plans "that he had ordered frozen some three months ago".
An Israeli government official said the tenders were for construction in a areas "that will remain part of Israel in any peace agreement" but there was no comment on the subsequent announcement of plans to advance another 1,800 new homes.
- 'Grave violation' -
Hanan Ashrawi of the Palestine Liberation Organisation said the Palestinians would seek UN intervention to bring Israel to account for its new settlement expansion drive.
"The executive committee of the PLO views this latest escalation with the utmost of seriousness and will counter it by addressing both the UN Security Council and the General Assembly as the proper way of curbing this grave violation and ensuring accountability," she said.
The last time the PLO sought a Security Council resolution against the settlements was in February 2011, but the move -- which was widely supported -- was blocked by a US veto.
Another senior official told AFP the leadership was considering an appeal to the international justice system.
"The Palestinian leadership is looking seriously into going to international courts against settlement activity," he said.
The option of legal action against Israeli settlement building at the International Criminal Court opened up after the Palestinians won observer state status at the United Nations in 2012.
Although they agreed to freeze any such initiative during US-led peace talks, the negotiations collapsed in April, with Washington acknowledging persistent settlement expansion played a major part.
"It is time to hold Israel accountable in front of international organisations," chief negotiator Saeb Erakat told AFP.
"Those who fear the international courts should stop their war crimes against the Palestinian people, first and foremost of which is settlement activity."
- A worrying sign -
Nimr Hammad, political adviser to Palestinian president Mahmud Abbas, demanded the US take "serious steps" against Israel.
"Netanyahu is a liar and is not interested in the two-state solution," he told AFP, saying the Israeli leader wanted "to push the Palestinians into one of two options: either a confrontation, or... to go to the United Nations."
Erakat said the new tenders were "a clear sign that Israel is moving towards a major escalation, such as new settlement construction, the annexation of occupied territory and forcible transfer".
Since Monday, several hardline Israeli ministers have demanded that Israel respond to the new Palestinian government by annexing large swathes of the West Bank.